STATEHOUSE (Feb. 12, 2026) – The Indiana House recently passed legislation co-authored by State Rep. Martin Carbaugh (R-Fort Wayne) to provide more fairness and predictability to health care payments and establish clearer rules to protect patients from medical debt surprises.
Medical debt in Indiana tops $2 billion, ranking the state 11th nationally in number of residents with health care bills in collections. Carbaugh said many hospitals have financial assistance programs, but they are not consistently disclosed to patients and are rarely explained before medical bills go to collections. Additionally, insurance companies sometimes re-label medical procedures under cheaper codes or reopen settled claims to demand money back long after patients thought their bill was finalized.
"No one plans for medical debt, and they should not be blindsided by it," Carbaugh said. "This legislation brings clarity and consistency to the medical billing process by ensuring that Hoosier patients know their financial assistance options upfront and preventing insurers from changing the rules after the bill has been paid."
House Bill 1271 would require hospitals to inform patients about assistance programs before sending their bill to collections, and to proactively make information on financial assistance programs available.
Additionally, Carbaugh said the proposed legislation would lock payments once medical bills are paid to prevent insurers from retroactively demanding reimbursement after paying claims. To help protect the revenue of rural and community hospitals, insurance companies would be prohibited from recouping payments on the original facility when patient transfers occur.
Carbaugh is continuing his work on helping Hoosiers with medical costs. During the 2025 legislative session, he authored House Enrolled Act 1004 that curbs rising health care costs and ensures that nonprofit hospitals are operating in the public interest.
To learn more about House Bill 1271 and follow session, visit iga.in.gov.
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State Rep. Martin Carbaugh (R-Fort Wayne) represents House District 81,
which includes a portion of Allen County.
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